Question

1. Bank Reconciliation

   An accounting clerk for Chesner Co. prepared the following bank reconciliation:

   Chesner Co.
   Bank Reconciliation
   August 31
   Cash balance according to company's records			$6,500
   Add: Outstanding checks	$3,120
   Error by Chesner Co. in recording Check
   No. 1056 as $830 instead of $380	450
   Note for $10,200 collected by bank, including interest	10,610		14,180
   			$20,680
   Deduct: Deposit in transit on August 31	$6,620
   Bank service charges	50		6,670
   Cash balance according to bank statement			$14,010

   a. From the data in this bank reconciliation, prepare a new bank reconciliation for Chesner Co., using the format shown in the illustrative problem.

   Chesner Co.
   Bank Reconciliation
   August 31
   Cash balance according to bank statement		$
   Adjusted balance		$
   Cash balance according to company's records		$
   	$
   Adjusted balance		$

   b. If a balance sheet were prepared for Muskegon Co. on May 31, 2016, what amount should be reported for cash?
   $

Answer 1

a)

Chesner Co
Bank Reconciliation
August 31
Cash balance according to bank statement		$ 14,010
Adjustments
Deposit in transit	$    6,620
Oustanding checks	$ (3,120)
Total adjustments		$    3,500
Adjusted cash balance		$ 17,510
Cash balance according to company's records		$    6,500
Adjustments
Error in recording of check	$        450
Not collected by bank	$ 10,610
Bank service charge	$        (50)
Total adjustments		$ 11,010
Adjusted cash balance		$ 17,510

Chesner will report USD 17,510 as cash balance in their balance \sheet